Keventer Agro Ltd, situated in Kolkata, filed its DRHP with SEBI on August 8, 2021. The offering includes a fresh issuance for Rs.350 crore and an offer for the sale of up to 10,767,664 equity shares by Mandala Swede SPV, the company's 6.61 per cent shareholder. 15.35 million obligatory convertible preference shares are included in the OFS. A maximum of 9.15 million shares will be issued as a result of this.
The business is anticipated to collect Rs.50 crore through a pre-IPO placement, which will reduce the size of the offer. ICICI Securities Ltd, Axis Capital Ltd, and JM Financial Ltd are the book-running lead managers for the offer.
Keventer Agro is an FMCG firm situated in Kolkata that specialises in packaged, dairy, and fresh food. The firm employed 570 people and has 3,126 distributors as of March 31, 2021. They also serve retail customers in the range of 1,60,000-1,70,000. Bihar, Jharkhand, Orissa, West Bengal, Assam, Mizoram, Nagaland, and Sikkim are among the states where the company's products are sold. They have just lately begun selling their items in Madhya Pradesh, Himachal Pradesh, Punjab, Rajasthan, and Uttar Pradesh. The firm operates in urban, semi-urban, and rural regions, with plans to expand into rural areas. The firm is one of the fastest growing in the country's North East and Eastern regions. Over the previous ten years, the firm has grown at a CAGR of 18.46 per cent. The company's conventional sales account for 92.5 per cent of total sales, while contemporary channels account for only 7.5 per cent of total sales.
Keventer Agro IPO Objectives
- The company's capital expenditure demand would be funded with Rs.110.76 crore.
- Repayment and/ or pre-payment, in full or part, of certain borrowings availed by the Company.
- Funding capital expenditure requirements of the Company.
- General corporate purposes.
Why should you invest in Keventer Agro IPO?
- The Fast-Moving Consumer Goods (FMCG) Industry is currently the fourth largest contributor to the Indian economy. In FY20, the FMCG market in India was estimated at INR 6.75 lakh Cr. expected to reach INR 11.20 lakh Cr. by FY25.
- Indian food retail remains dominated by unbranded products such as fresh fruits and vegetables, loose staples, fresh unpackaged dairy and meat.
IPO Financials
| Year ended March 31, 2019 | Year ended March 31, 2020 | |
|---|---|---|
| Total Revenue from Operations | 881.723 | 945.114 |
| Gross Profit | 269.119 | 272.474 |
| Gross Margin | 30.52% | 28.83% |
| Adjusted EBITDA | 63.639 | 43.550 |
| Adjusted EBITDA Margin | 7.22% | 4.61% |
| Net Asset turnover | 0.225 | 0.210 |
| ROCE – reported (%) | 8.82% | 2.67% |
| ROCE – without revaluation of land (%) | 13.32% | 4.00% |
| Adjusted Net debt | 151.987 | 243.945 |
| Net Working Capital Days | 2.803 | 3.003 |
Know before investing
Strengths
4The company is a major participant in the North East and Eastern parts of India, offering a diverse range of products to a diverse clientele.
Keventer Agro offers a multi-channel distribution platform that uses technology to maximise distribution efficiency. Supermarkets such as Big Bazar, Foodhall, and Spencer's Retail Ltd are among their retailers.
R&D and innovation, according to the corporation, are critical to maintaining a strong market position and a competitive advantage.
A major portion of the resources has been spent on marketing, as marketing and correct exposure are critical to the success of the company's many brands.
Risks
4Any delays or disturbances in the production process, as well as underutilization of manufacturing capacity, would have a negative impact on the business and operations.
Any decline or compromise in the quality of the items produced would harm the company's reputation and, as a result, sales.
If they don't keep their customers' brand recognition, they'll lose business.
Due to noncompliance, the securities of certain promoters were prohibited and stopped from trading on the Calcutta Stock Exchange.
